Most Japan Stocks Rise on Utilities; China Limits Gains

Sept. 18 (Bloomberg) -- Most Japanese stocks rose, led by
utilities on speculation the nation won’t halt construction of
nuclear reactors. Shares of Japanese companies operating in
China fell as a political dispute escalated between the two
nations, leading to widespread protests.

Hokuriku Electric Power Co., an operator of nuclear power
stations, jumped 6.4 percent. Companies including Honda Motor Co.
and Fast Retailing Co. slid as stores and factories in China
were shut. Sony Corp. climbed 4.5 percent on a report the
nation’s biggest consumer-electronics exporter is in final talks
to invest in Olympus Corp.

“There is concern that anti-Japanese protests may reduce
investment into China in the mid and long term,” said Koji Toda,
chief fund manager at Resona Bank Ltd. in Tokyo, which oversees
about 15 trillion yen ($191 billion). “The situation is
uncertain and we don’t know how long it will last.”

The Topix Index climbed 0.2 percent to 758.36 at the 3 p.m.
close in Tokyo, with about five shares rising for every three
that fell. The Nikkei 225 Stock Average fell 0.4 percent to
9,123.77 after rising as much as 0.2 percent earlier. Volume on
the gauge was more than 20 percent above the 30-day average.

The Topix rebounded 9 percent from this year’s low on June
4 as central banks step up measures to promote global economic
growth. The price of shares on the gauge stood at 0.9 times book
value, compared with 2.3 times for the Standard & Poor’s 500
Index and 1.5 times for the Europe Stoxx 600 Index. A number
less than one means that companies can be bought for less than
the value of their assets.

Utilities Climb

Utilities gained the most among the Topix’s 33 industry
groups after the Nikkei newspaper reported Japanese Trade
Minister Yukio Edano signaled he has no plans to stop
construction of reactors that have already been approved,
despite a goal to scrap nuclear power by the end of the 2030s.

Shares of Japanese companies operating in China declined as
a territorial dispute sparked the worst diplomatic crisis
between the two nations since 2005, putting at risk a trade
that’s tripled in the past decade to more than $340 billion.
Japan last week purchased islands claimed by both nations.

Fast Retailing sank 7 percent to 17,480 yen after shutting
42 of its Uniqlo apparel shops in China. Aeon Co. fell 2.8
percent to 872 yen after the Nikkei newspaper reported it
suffered 2.5 billion yen ($32 million) in damages in China.
Retailers led declines on the Topix, followed by carmakers.

Honda, Toyota Motor Corp. and Nissan Motor Co. all reported
damage to dealerships in the eastern Chinese city of Qingdao.
Separately, Phoenix Satellite Television Holdings Ltd. showed
footage of Japanese cars that had been overturned, with
windshields smashed by protesters.

Carmakers Slide

“Carmakers are supposed to be rising the most today, but
concerns about various anti-Japanese movements are dragging them
down even though the yen is weakening,” Resona Bank’s Toda said.

The yen depreciated to as low as 78.93 against the dollar
last night in Tokyo, compared with 77.57 at the close of stock
trading on Sept. 14. Japan’s currency weakened to 103.86 against
the euro, the lowest since May 9, from 101.13. A weaker yen
boosts overseas income at Japanese companies when repatriated.

Canon Inc., a camera maker that gets almost 60 percent of
its sales from Europe and the Americas, rose 1 percent to 2,812
yen. Ricoh Co., an office-equipment maker that generates more
than 45 percent of its revenue in the two regions, advanced 1.5
percent to 683 yen.

Sony gained 4.5 percent to 1,027 yen after public
broadcaster NHK reported on Sept. 14 the company will invest
about 50 billion yen in Olympus and set up a company to
manufacture medical equipment. Olympus slipped 1 percent to
1,540 yen after rising as much as 4.6 percent earlier today.

Futures on the S&P 500 fell 0.1 percent today. The gauge
fell 0.3 percent yesterday after manufacturing in the New York
region contracted more than forecast as orders shrank.